Question
The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order cost system. The following transactions occurred during July:
The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order cost system. The following transactions occurred during July:
July 3. | Charged 430 hours of professional (lawyer) time to the Obsidian Co. breech of contract suit to prepare for the trial, at a rate of $200 per hour. |
10. | Reimbursed travel costs to employees for depositions related to the Obsidian case, $26,000. |
14. | Charged 120 hours of professional time for the Obsidian trial at a rate of $250 per hour. |
18. | Received invoice from consultants Wadsley and Harden for $45,500 for expert testimony related to the Obsidian trial. |
27. | Applied office overhead at a rate of $65 per professional hour charged to the Obsidian case. |
31. | Paid administrative and support salaries of $25,400 for the month. |
31. | Used office supplies for the month, $8,600. |
31. | Paid professional salaries of $173,700 for the month. |
31. | Billed Obsidian $254,700 for successful defense of the case. |
a. Provide the journal entries for each of these transactions. If an amount box does not require an entry, leave it blank.
July 3 | |||
July 10 | |||
July 14 | |||
July 18 | |||
July 27 | |||
July 31 Admin. sal. | |||
July 31 Supplies | |||
July 31 Prof. sal. | |||
July 31 Billed | |||
July 31 Cost | |||
b. How much office overhead is over- or underapplied? Enter your answer as a positive number. $fill in the blank 1696fa07cff4065_1
c. Determine the gross profit on the Obsidian case, assuming that over- or underapplied office overhead is closed monthly to cost of services. $fill in the blank 1696fa07cff4065_3
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started